GROZNY IN FLAMES. Heavy fighting continued in Grozny on 8-9 August as
separatist fighters pressed ahead with their assault on the government compound
in the center of the city, Russian and Western media reported. Russian officers
claimed that federal forces were "expanding their area of control" in the city
and driving back the rebels. But a Russian TV (RTR) reporter trapped in a hotel
attached to the compound denounced such statements as "worse than lies" early
on 9 August, saying that the blazing main government building had been gutted,
while its defenders, having received almost no reinforcements, had "moved to
other strong points." Separatist commanders earlier told AFP that they had
seized part of the building and would soon capture the rest. The complex,
headquarters of the pro-Moscow government headed by Doku Zavgaev, is a hated
symbol of Russian power in the republic and the site of frequent separatist
demonstrations. -- Scott Parrish

YELTSIN TAKES OATH OF OFFICE, NOMINATES CHERNOMYRDIN. Against the
background of fierce fighting in Grozny and reports of ill health, President
Boris Yeltsin began his second term on 9 August by pledging to protect human
rights and the integrity of the country, ITAR-TASS reported. The president only
spoke for a few seconds during the ceremony and made no speech, suggesting that
he has not recovered from his tiring campaign. Western news described him as
speaking slowly but firmly. The entire ceremony lasted 25 minutes. Yeltsin
also officially nominated Viktor Chernomyrdin as his prime minister: the Duma
is expected to meet on 10 August to vote on his candidacy. The president's
press service announced that Yeltsin will go on vacation after the Duma vote
but that the place and length of his leave have not yet been determined,
Izvestiya reported. -- Robert Orttung

FEDERATION COUNCIL SETS UP CHECHNYA COMMISSION. The Federation Council
decided on 8 August to set up its own commission to seek a peaceful resolution
to the Chechen crisis, ITAR-TASS reported. Council Speaker Yegor Stroev said
that Kabardino-Balkariya President Valerii Kokov will chair the commission.
"Even with bandits it is better to negotiate than shoot, even if it takes a
long time," Stroev argued. In July 1995, a Duma commission on Chechnya chaired
by Stanislav Govorukhin recommended President Yeltsin's impeachment, attacked
critics of the war like Duma member Sergei Kovalev, and called for Chechnya's
exclusion from the Russian Federation (see OMRI Daily Digest, 24 July
1995). -- Robert Orttung

CHERNOMYRDIN CALLS FOR TOUGH MEASURES IN CHECHNYA. Prime Minister Viktor
Chernomyrdin called for the "toughest measures to be taken against the
terrorists and criminals in the Chechen Republic" but rejected the resumption
of full-scale war, ITAR-TASS reported on 8 August. He warned that "we cannot
allow the situation to deteriorate into another Afghanistan." He said that the
introduction of federal troops into the city had been delayed even though there
were signals of an impending attack. He added that a number of roadblocks and
checkpoints around the city had been withdrawn without explanation.
Chernomyrdin said that the procurator-general would determine what had happened
and punish the guilty parties. -- Robert Orttung

FEDERATION COUNCIL REJECTS MINIMUM WAGE, PENSION HIKE. The parliament's
upper house rejected on 8 August bills passed by the Duma raising the minimum
wage and minimum pension, Russian agencies reported. Under the draft
legislation, the minimum wage would have increased by 26% to 95,320 rubles
($18.33) a month as of 1 July; the minimum pension would rise to the same
amount as of 1 August while all other pensions would be indexed by 37%. The
Federation Council Social Policy Committee recommended against approving the
increases, which were also opposed by the government, on the grounds that they
are unaffordable. The minimum wage increase would require an additional
expenditure of 8.7 trillion rubles. The Pension Fund is in severe financial
difficulties, running a deficit of 6.5 trillion rubles on 1 July. The upper
house consists of regional leaders, who are often held accountable for delays
in wage and pension payments. -- Penny Morvant

BABURIN REFUSES TO JOIN NEW OPPOSITION BLOC. The deputy chairman of the
Duma and leader of the Russian All-People's Union (ROS), Sergei Baburin, has
refused to join Gennadii Zyuganov's new Popular-Patriotic Union of Russia,
ITAR-TASS reported on 8 August. Baburin criticized Zyuganov and the Communist
Party for numerous strategic miscalculations during the presidential campaign.
Despite Zyuganov's offer to Baburin of a position in a potential Communist
coalition government between the two rounds of the election, Baburin has been
extremely critical of the Communists since the campaign. He told Vek
(no. 31) that he would join President Yeltsin's government if offered a serious
position. -- Robert Orttung

ROSTOV MINERS CONTINUE STRIKE. The leader of the Rostov miners trade
union, Vasilii Kryukov, has announced that 40,000 local miners will continue
the strike they started on 4 August until all their demands are fulfilled,
ITAR-TASS reported on 8 August. The government's transfer of 50 million rubles
(about $10,000) to the Rostov Oblast was only enough to pay half of the miners'
wages for March. The Russian Coal Industry Workers' Union has threatened to
hold a nationwide strike on 25 August-- miners' day in Russia--if their demands
are not met. -- Anna Paretskaya

PENSIONERS PROTEST DELAYED PAYMENTS. A crowd of angry pensioners blocked
the main streets of Abakan, the largest city in the southern Siberian republic
of Khakasiya, to demand their pensions for July, ITAR-TASS reported on 8
August. Earlier this week, pensioners rallied in Voronezh after rumors spread
that they would not receive their pensions for July, NTV reported on 5 August.
-- Anna Paretskaya

YET ANOTHER BUSINESSMAN MURDERED. Nikolai Povosin, the president of the
construction company Boniks based in the Moscow Oblast town of Krasnogorsk, has
been shot to death, ITAR-TASS reported on 8 August, citing an Interior Ministry
spokesman. Meanwhile, the director of the Moscow City Interior Ministry
Department, Lt. Gen. Nikolai Kulikov, said that 53,000 crimes--including 900
murders--have been reported in Moscow so far this year. Kulikov also said that
about 500 "tramps and panhandlers" have been ousted from Moscow since the
president's July decree on combating crime in Moscow. An additional 600
"foreign citizens doing illegal business in Moscow" were expelled after a
similar decree from the mayor. -- Anna Paretskaya

SHORTFALL IN MILITARY HOUSING GROWS. According to sources in the Defense
Ministry, more than 150,000 officers, NCOs, and warrant officers in the armed
forces are on waiting lists for housing, ITAR-TASS reported on 8 August.
Russian military construction workers were said to have built 12,000 new
apartments so far this year, but the sources said the supply is far below
demand. In October 1995, a deputy defense minister said that 125,000 officers'
families were without apartments. -- Doug Clarke

WAGE DEBT GROWING DESPITE MASSIVE GOVERNMENT OUTLAYS. First Deputy Prime
Minister Oleg Lobov said on 8 August that 32% of all budget expenditure during
the first half of the year went on paying wages and back wages, ITAR-TASS
reported. Planned expenditure was only 15%. Despite these efforts, following a
pre-election pledge by President Yeltsin to eliminate wage arrears in the state
sector, the total wage debt equaled 29.9 trillion rubles ($5.7 billion) at the
end of July. Continuing with his gloomy portrait of the economy, Lobov said
that the state budget is owed about 80 trillion rubles and that barter deals
account for up to 30% of industrial turnover. He added that revenue from state
securities is now lower than the amount needed to buy back treasury bills that
are due, that investment has fallen by 14%, and that capital flight exceeds $35
billion. -- Penny Morvant

TREASURY TAX EXEMPTIONS ABOLISHED. The head of the State Tax Service
(GNS), Vitalii Artyukhov, said that from 15 August 1996 the GNS will not accept
treasury tax exemptions (KNOs)--issued by the Finance Ministry--from companies
in lieu of tax payments, Radio Rossii reported on 7 August. KNOs worth 9
trillion rubles ($1.7 billion) have been issued: many of them are now being
traded on the secondary financial market. KNOs and other money-surrogates, such
as bills of exchange and the Finance Ministry's bank credit guarantees, are
used by companies as "payment" for taxes. -- Natalia Gurushina

RUSSIA SUES U.S. TAX AUTHORITIES. Russia's State Committee for Precious
Metals and Stones (Roskomdragmet) is suing the Internal Revenue Service (IRS)
over the sale of assets belonging to the U.S. company Golden Ada, ITAR-TASS
reported on 9 August. In 1992-1994, Russia delivered more than $171 million
worth of rough diamonds to Golden Ada for cutting but received neither money
nor diamonds, as Golden Ada's owners resold the company and disappeared. The
scandal led to the dismissal of Roskomdragmet chairman Yevgenii Bychkov in
February 1996 on corruption charges. Golden Ada's office and assets worth some
$60 million were seized by the IRS for tax evasion. The Russian side, however,
contests this move and claims that the confiscated property should be used to
compensate Russia's losses. -- Natalia Gurushina

AZERBAIJAN, IRAN SIGN AGREEMENT ON FIGHTING DRUG TRADE. Azerbaijani
Interior Minister Ramil Usubov signed an agreement with his Iranian counterpart
on cooperation in the fight against drug smuggling last week, according to a 6
August IRNA report monitored by the BBC. Details concerning the accord were not
made available. Iran and Azerbaijan are both important transit countries for
the trade in southwest Asian opium and opium poppies and cannabis are also
cultivated along the border between the two countries. The opium that reaches
Azerbaijan from Turkmenistan, Kazakhstan, or Iran is being transported via
Nakhichevan to Turkey, according to the Observatoire Geopolitique des Drogues,
a Paris-based monitoring group. -- Lowell Bezanis

Aliyev IN MOSCOW. Azerbaijani President Heidar Aliyev expressed his
willingness to meet with his Armenian counterpart, Levon Ter-Petrossyan, while
in Moscow for the inauguration of President Boris Yeltsin, NTV reported on 8
August. Aliyev did meet with Moscow mayor Yurii Luzhkov to discuss the recent
arrests of Azerbaijanis in anti-crime actions in Moscow. Aliyev also said that
Chernomyrdin is preparing decrees for the opening of the Russian-Azerbaijani
border, which was closed after the onset of the Chechen war. -- Peter Rutland

ABKHAZ PEACEKEEPING UPDATE. The Russian Federation Council voyed on 8
August to extend the mandate of the Russian-dominated CIS peacekeeping force in
Abkhazia by six months, RFE/RL reported. Georgia has been pushing Russia to
involve the 1,500 peacekeeping troops in mine clearing and in helping some
250,000 Georgian refugees return to their homes in Abkhazia. Meanwhile,
Georgian Radio on 5 August reported that the Turkish government will welcome
Georgian efforts to halt ships under the Turkish flag from entering Abkhazian
ports without the proper permits. The port of Sukhumi is a lifeline for the
breakaway region and is also believed to be vital to smuggling activities
involving Turkey and other Black Sea littoral states. -- Lowell Bezanis

TURKMEN-RUSSIAN GAS PROJECT. Turkmen President Saparmurad Niyazov met
with the Russian Gazprom company chairman Rem Vyakhirev on 8 August to sign an
agreement on forming the new corporation Turkmenrosgaz, NTV reported.
Turkmenistan will hold 51% of the shares in the venture, Gazprom-45% and the
transnational corporation Itera-4%. The first project the new corporation plans
to undertake is a pipeline providing Turkmen gas to Pakistan via Afghanistan.
The disruption in supply lines for Turkmen gas after the collapse of the Soviet
Union has cut export of Turkmen gas nearly in half. According to RTR,
Turkmenistan produced 90 billion cubic meters of gas in 1990, compared to 48
billion so far this year. -- Bruce Pannier

TAJIK AUTHORITIES CLOSE TO WRAPPING UP OSIMI MURDER CASE. The Tajik
Security Ministry claimed on 8 August that one of the suspects in the murder of
Tajik Academy of Sciences chairman Mohammed Osimi (see OMRI Daily
Digest, 30 July 1996) killed himself in a shoot out with the militia on 31
July, according to ITAR-TASS. Amrullo Saidov and five others, who were
allegedly part of a gang that operated near Dushanbe, all died when the state
militia raided their hideout. -- Bruce Pannier

UKRAINIAN GOVERNMENT CUTS OFF POWER TO THOUSANDS OF DELINQUENT CUSTOMERS.
The government has cut off power to 15,000 delinquent customers, chiefly
businesses, Ukrainian TV and Reuters reported on 8 August. Energy Ministry
officials told reporters that more than 50,000 enterprises, including small
retail outlets and large factories owe regional utilities some $1.1 billion in
unpaid bills. In other news, Ukraine's acting Prosecutor General announced that
his office had found evidence of large-scale corruption among officials and
managers of enterprises in the coal mining, education, health care, and other
government-financed sectors. Oleksander Khrystenko said his investigators had
discovered dozens of cases of embezzlement of government funds destined for
wages, particularly by the managers of 10 coal mines in eastern Ukraine, which
greatly exacerbated the wage debt crisis. He also said ministry officials
neglected to monitor the use of the funds. Khrystenko said his office would
continue its inquiry, which may prompt pressing charges. -- Chrystyna
Lapychak

QUESTIONS ON BELARUSIAN REFERENDUM NARROWED DOWN. The number of
questions on President Alyaksandr Lukashenka's 7 November referendum has
reportedly been reduced to two, Belapan reported on 8 August. The referendum
will now ask if people prefer public or private land ownership and whether they
approve of the new version of the constitution. The government is reportedly
launching a large-scale propaganda campaign to educate people on the necessity
of amending the constitution. Prior to the May 1995 referendum, in which each
of the four questions passed with more than 75 percent of the vote, the
state-controlled media had worked overtime promoting Lukashenka's agenda. It
can be expected to do the same this fall, and the yes-or-no nature of the
vaguely worded questions will likely work to Lukashenka's advantage. -- Ustina
Markus

SEVASTOPOL CUTS ELECTRICITY TO BLACK SEA FLEET. The aviation squadron of
the Black Sea Fleet has had its electricity cut off because it owes the
supplier Krymenergo 25 billion karbovantsy ($140,000), ITAR-TASS reported on 8
August. In addition, 500 servicemen in the squadron have not been paid since
the beginning of the year. The electricity cut coincided with the Ukrainian
government's crackdown on enterprises that fail to pay their bills. During a 5
August press conference, Ukrainian Navy Commander Volodymyr Bezkorovainy
addressed the fleet's debts, saying it was "living off of Ukrainian money,"
Ukrainian radio reported The fleet owes the city of Sevastopol 2 trillion
karbovantsy ($11 million) for utilities, and 5 trillion ($27.7 million) for
damages to the city. -- Ustina Markus

ELECTION UNION OF ESTONIA'S RIGHT-WING PARTIES FORMED. Representatives
of the Pro Patria Union, the Moderates, the Estonian Farmer's Party, and the
Republican and Conservative People's Party signed an agreement on 8 August
establishing the coalition "Right-Wing Parties and Moderates" for the local
elections in Tallinn on 20 October, ETA reported. Pro Patria Chairman Toivo
Jurgenson noted that the coalition is only for Tallinn and that, depending on
local conditions, the four parties could run on separate lists in other areas.
None of these parties are in the current ruling coalition, but ruled the
country from 1992 to March 1995 under different names. -- Saulius Girnius

EU HELPS LITHUANIA DRAFT MONEY-LAUNDERING LAW. Three coordinators of the
"Money Laundering" project under the auspices of the EU PHARE program
"Combatting Drugs in CENTRAL AND EASTERN EUROPE" arrived in Lithuania on 8
August, BNS reported. The goal of their three-day visit is to analyze the
situation and help draft a law on money laundering. Dr. Ona Grimalauskiene,
deputy chairwoman of the State Narcotics Control Commission, said that the
adoption of such a law might influence the attitudes of foreign governments and
attract more investments to Lithuania. The republic intends to join the 1988
United Nations Convention on the Control of Illegal Narcotics Funds. One of the
most important criteria for membership is the adoption of a money-laundering
law. -- Saulius Girnius

COURT DECLARE GDANSK SHIPYARD BANKRUPT. The regional court in Gdansk
ruled on 8 August that Gdansk shipyard is bankrupt. The Solidarity movement was
born in the shipyard in 1980 and Poland's former President Lech Walesa worked
there as an electrician. The shipyard employs 6,000 people and has debts of 414
million zlotys ($152.1 million) and assets of only 350 million zlotys ($128.6
million). The shipyard's creditors have two months to file claims. The current
management has created a new company using some of the shipyard's assets. The
company, New Gdansk Shipyard, is to take over the profit-generating contracts
of the bankrupt shipyard. It is estimated, however that half of the work force
will lose their jobs. -- Jakub Karpinski

CZECH REPUBLIC'S KREDITNI BANKA COLLAPSES. The Pilsen-based Kreditni
Banka on 7 August became the most recent Czech financial institution to have
its banking license revoked by the Czech National Bank, Hospodarske noviny
reported the following day. Kreditni Banka's losses may run as high as
10-12 billion crowns ($370-$440 million), and more than 4 billion crowns worth
of claims against the bank have already been filed by its depositors. This sum,
which is likely to increase in the future, is well in excess of what can be
covered either by Ceska pojistovna, Kreditni Banka's owner and the Czech
Republic's largest insurance company, or by the banking insurance fund. Since
the state holds significant equity stakes in Ceska pojistovna's shareholders,
Czech taxpayers are likely to pick up the tab for the losses incurred by
Kreditni Banka's incompetent, if not outright fraudulent, management. -- Ben
Slay

SLOVAK PROSECUTOR GENERAL VIOLATES CONSTITUTION? Prosecutor General
Michal Valo has ordered that President Michal Kovac's pardon of two men
involved in the Technopol fraud case (see OMRI Daily Digest, 19 July)
cannot be implemented until the Constitutional Court rules on Valo's earlier
complaint regarding presidential pardons, Narodna obroda reported on 9
August. Valo had filed a complaint with the Constitutional Court after Kovac
pardoned former secret service agent Oskar Fegyveres, who confessed to
participating in Kovac Jr.'s abduction last year. The two men granted pardons
by Kovac were his son's business associates. Kovac argued that the case was
overly politicized, and he wanted to allow them to testify in Germany. In a
letter to Valo, Kovac pointed to sections of the Constitution and Penal Code
obliging the prosecution to immediately accept a presidential pardon.
Presidential legal expert Ivan Trimaj said "it is hard to imagine a grosser
infringement of the constitution and the law." -- Sharon Fisher

HUNGARIAN ENVIRONMENTALISTS DEMAND END TO DANUBE DIVERSION. Hungarian
environmental activists and hydrotechnicians demanded at a 7 August meeting
that Slovakia stop diverting the Danube to feed the Gabcikovo hydroelectric
plant, CTK reported the following day. The meeting's participants called on the
International Court of Justice in The Hague, where the case is waiting to be
heard, to rule that Slovakia should stop diverting the waters. "Hungary is not
just asking the court to rule whether Slovakia was justified in completing
Gabcikovo after Hungary pulled out of the project. We are also asking the court
to decree that the full amount of water should be released into the old Danube
course," activist Laszlo Valki told MTI. The joint Slovak-Hungarian project was
launched in 1977, but Hungary pulled out after communism fell. -- Sharon
Fisher

SECURITY COUNCIL THREATENS SANCTIONS OVER KARADZIC,
MLADIC. The UN's top body approved a non-binding resolution on 8 August
demanding that all sides in Bosnia-Herzegovina cooperate with the Hague-based
war crimes tribunal, the BBC reported. The text added that "the council is
ready to consider the application of economic enforcement measures to ensure
compliance by all parties with the obligations under the peace agreement,"
Reuters noted. The latest resolution singles out the Bosnian Serbs' failure to
deliver to the court their military chief Gen. Ratko Mladic and leading
civilian figure Radovan Karadzic. Earlier sanctions hit Belgrade and Pale hard
and helped bring the Serbs to the peace talks in Dayton last year. Bosnia's UN
ambassador, Muhamed Sacirbey, cautioned that any initiative to reimpose
sanctions would have to start in the major capitals, not at the UN. -- Patrick
Moore

MUSLIMS, CROATS FAIL TO AGREE ON HERCEG-BOSNA. Bosnian Federation senior
officials failed to agree on 8 August on the dissolution of the Croat
mini-state of Herceg-Bosna, Oslobodjenje reported the next day. Bosnian
Prime Minister Hasan Muratovic said the Croats had presented new conditions on
the Herceg-Bosna dissolution instead of simply abolishing it. Bosnian
Federation President Kresimir Zubak accused Muslims of preventing the
functioning of the federation by not transferring the authority from the
republic to it. U.S. envoy to Bosnia John Kornblum and Croatian Foreign
Minister Mate Granic were present at the meeting. Kornblum voiced deep regrets
over the failed talks, Reuters reported. Meanwhile, the High Representative for
Bosnia Carl Bildt said he was not satisfied with anything concerning the
implementation of the federation, Reuters reported on 7 August. Bildt said he
remained concerned about its future despite the Mostar power-sharing agreement
between Muslims and Croats. -- Daria Sito Sucic

OSCE CONCERNED OVER SERB STATEMENTS ON SOVEREIGN STATE. The OSCE's
spokesman in Sarajevo, Joanna van Vliet, said on 8 August that the organization
overseeing Bosnia's upcoming general elections was concerned over Bosnian Serb
officials' statements giving the Republika Srpska (RS) the right to assert
sovereignty as an independent state, international agencies reported. Biljana
Plavsic, acting RS president, said repeatedly during her pre-election campaign
that the September elections would "legalize the sovereignty" of the RS,
Reuters reported. The OSCE reminded Bosnian Serb officials that the rules set
up by the Dayton peace accords state that "Bosnia-Herzegovina shall consist of
the two entities, the Bosnian Federation and the Republika Srpska." Meanwhile,
UN special envoy to Bosnia Iqbal Riza discussed security arrangements for
Bosnia's elections with RS Foreign Minister Aleksa Buha. Buha was concerned
over possible incidents if a large number of voters crossed from one entity to
the other, AFP reported on 8 August. -- Daria Sito Sucic

SERBIAN OPPOSITION LEADERS REACT TO MILOSEVIC-TUDJMAN SUMMIT. Serbia's
opposition leaders have begun reacting to the 7 August summit between Serbian
President Slobodan Milosevic and Croatian President Franjo Tudjman, Nasa
Borba reported on 9 August. The Serbian Renewal Movement, led by Vuk
Draskovic, welcomed news of a possible normalization of bilateral relations but
queried: "Why didn't Tudjman and Milosevic agree on normalization three or four
years ago? Why didn't agreement...come when nearly a million Serbs lived in
Croatia?" The SPO added that it would "fight for the return of Serbs to Krajina
[in Croatia] and to those places where they have lived for centuries." For his
part, Vojislav Seselj, accused war criminal and ultranationalist leader of the
Serbian Radical Party, said Milosevic once again "sold out" Serbian national
interests, especially by abandoning the Serbs in eastern Slavonia through his
hints that he would recognize Croatia's international borders. -- Stan
Markotich

SERBIAN PRESIDENT ON THE CAMPAIGN TRAIL? Serbian President Slobodan
Milosevic may be trying to influence voters for in the industrial town of
Kragujevac, where he has recently promised to give the local car manufacturer
Zastava a large cash grant of about $19 million, Reuters reported on 8 August.
Opposition Democratic Party spokesman Slobodan Vuksanovic reacted to
Milosevic's announcement by saying the president "is buying social peace ahead
of the elections...It is a usual thing. This is the best time for the
government to start promising and misleading people." Federal parliamentary
elections in Serbia-Montenegro are due before year's end. -- Stan Markotich

ROMANIAN GOVERNMENT RESHUFFLE IN OFFING? President Ion Iliescu, Prime
Minister Nicolae Vacaroiu, and other leaders of the Party of Social Democracy
(PSDR) in Romania discussed on 7 August the feasibility of a government
reshuffle, Radio Bucharest reported on 9 August, citing the independent news
agency Mediafax. The Health, Agriculture, Labor and Social Protection and Youth
and Sports ministries are likely to be affected, as well as several county
prefect positions. A final decision is to be made next week. Also next week,
the PDSR leadership expects a reply from Minister of Foreign Affairs Teodor
Melescanu to the PDSR initiative that he take over managing President Ion
Iliescu's electoral campaign. Melescanu is officially not a PDSR member and the
offer has been criticized by some political observers and opposition leaders.
-- Michael Shafir

CONTROVERSY SURROUNDING ROMANIAN NEWS AGENCY. A group of employees of
the Information and Synthesis Center of the RADOR news agency, which is part of
the Romanian Radio Company, on 7 August protested the dismissal of their editor
in chief and his replacement by a former activist of the Communist Party's
Central Committee. Its protest letter, which was received by OMRI, says that
Mihai Andrei, the dismissed editor in chief, set up the center six years ago
and implemented stringent standards for unbiased, non-discriminatory reporting
and prompt delivery of information. The center monitors broadcasts in Romania
and foreign broadcasts in the Romanian language, supplying information
bulletins to government and non-governmental organizations, political parties,
and news agencies. The signatories say Andrei's dismissal will endanger
independence and emphasize that this bodes ill on the eve of elections. --
Michael Shafir

SMIRNOV ON CHISINAU-TIRASPOL RELATIONS. Dniester breakaway region leader
Igor Smirnov told a press conference on 7 August that "Moldovan President
Mircea Snegur is the only one to blame for the delay in signing the memorandum
on settling relations between Moldova and the Dneister region," BASA-Press
reported the next day. Smirnov said Russian President Boris Yeltsin and
Ukrainian President Leonid Kuchma are "ready to sign the memorandum" and
everything now depends on Snegur. Snegur himself left on 8 August for Moscow,
heading the Moldovan delegation attending festivities for the Yeltsin
inauguration. A Moldovan Ministry of Foreign Affairs spokesman told BASA-Press
that he could not comment on speculations that the memorandum will be signed in
Moscow on this occasion, but added that the Dniester representatives will be
present at the event too. -- Michael Shafir

BULGARIA TACKLES GRAIN SHORTAGE ADMINISTRATIVELY. The Bulgarian
government submitted to parliament on 8 August the annual bill governing the
trade regime in grain, Trud reported the same day. The proposed law
limits grain producers' profitability to 15%, requires them to declare the size
of their harvests within one month of their gathering, allows the government to
introduce "extraordinary measures"--which some interpret as forcible grain
requisitioning--in cases of shortage, and sets fines for grain trading without
a license and refusing to provide information on grain dealings. The government
has set aside 25 billion leva ($134 million) to purchase this year's harvest,
whereas 70 billion leva is needed, Pari reported on 7 August. In other
economic news, consumer price inflation in July was 23.3%, the highest rate
since March 1991, bringing such inflation to 81.9% so far this year. -- Michael
Wyzan

BULGARIAN PRESIDENTIAL ELECTIONS UPDATE. The Central Electoral
Commission for the upcoming presidential election held its first meetings on 7
and 8 August, Trud and Standart reported. At the initial meeting,
opposition and majority representatives in the commission disagreed on whether
candidates should register as "Bulgarian citizens" or "Bulgarian citizens by
birth." The latter could bar the Socialist candidate, Foreign Minister Georgi
Pirinski, from registering, since he was born in New York and acquired U.S.
citizenship at birth. At the 8 August meeting, the commission approved a
registration form on which the candidate does not have to declare his
citizenship. But candidates must present a certificate from the police stating
their citizenship and saying how they acquired it. Candidates must register
between 12 August and 22 September. Decisions of the Central Electoral
Commission must be made by two thirds of its members. -- Stefan Krause

ALBANIAN SPECIAL COMMISSION TO INVESTIGATE THE DEATH OF ALLEGED BANK ROBBER.
A special commission has been set up to investigate the mysterious death of
Shpetim Cashku, president of the Agi trade company, Koha Jone reported
on 9 August. Cashku was shot by special police forces inside the Tirana Savings
Bank on 27 July and later died in the hospital. Reports are conflicting,
however. Early ATSH reports said Cashku had taken hostages after he was refused
a credit of $300,000, but bank employees later denied that report. ATSH also
quoted witnesses as saying that only Cashku's arm was injured, but later he
reportedly died of shots in his back. Koha Jone also mentions a
mysterious letter from Prime Minister Aleksander Meksi, who apparently had
approved the credit, that later disappeared. Koha Jone also pointed out
that the Albanian TV broadcast the 27 July incidents live for about an hour. --
Fabian Schmidt

NUMBER OF ALBANIAN DESERTERS ON THE RISE. In the past six months, 166
army deserters have been sentenced to between four and six years imprisonment
in Tirana alone, international agencies reported on 7 August. Reportedly four
times as many deserters are awaiting trial in the capital. Hundreds more have
fled the army to neighboring countries and the situation is similar in other
parts of Albania. Prosecutors have reportedly begun calling for harsher
sentences against deserters and draft dodgers. -- Fabian Schmidt